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The crisis mindset: building business resilience

The crisis mindset: building business resilience

Uncharted waters. Never seen before for decades. Unpredictable. Volatile. No visibility. A crisis of truly unknown proportions in duration, depth and breadth.

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renos-ioannides

Board Member, Deal Advisory

KPMG in Cyprus

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resilience

Probably the culmination of the intense globalisation, recent technology progresses, the collapse of the conventional competitive landscape and its re-invention.

Disruption. Rapid Disruption. These two words encapsulate all the far-reaching changes taking place in our personal, professional, business and social lives at the speed of light.

A crisis may be daunting. But it is not unmanageable, it is not unbeatable. It takes a very clear mindset to deal with it though. The mindset of a warrior. A wise warrior keeps his/her cool and does not despair. He (or she) retracts and he assesses. He consults. He plans. He devises actions and contingency plans. He executes. He steps back, re-assesses, re-adjusts. He perseveres. He delivers.

This is not the mindset that our business world has come to know. Our business world is used to conventional time-tested structures, repetitive procedures. Our business world is not well-adapted to change, to new thinking, to disruption. Our business world is not used to long-term planning, to holistic management of situations, to fast, flexible and agile adaptation. Our business world has learnt to get by with crises, which come and go, on a piecemeal, fire-fighting approach. Our business world has not been taught how to learn from experience, to constantly monitor the situation and to adjust whenever necessary. Our business world is not resilient. Except for a few light-shining examples. Which show the difference. Which evidence what resilience is really made up of.

What does business resilience mean? It means to have the buffers, to have the strength, the character, the willingness, the passion, the capacity and the agility to survive any set-back, to restore and preserve business value, to thrive under any circumstances.

What, then, are the constituents of business resilience?

- First and foremost, the knowledge that nobody is indestructible, imperishable. Even the strongest fail

- Secondly, the appreciation that nobody knows it all. There is always someone who is more experienced in certain areas, more knowledgeable, more capable

- Third, having an overriding objective which is none other than to save the business in the short-term, restore and preserve its viability in the medium-term, and ultimately make it thrive in the long-term

- Fourth, maintaining an intractable commitment to have accountability, to take full responsibility. This is the call for Boards of Directors, business managers and business owners; these ‘business sponsors’ ought to take full control of the business situation

- Fifth, these ‘business sponsors’ must be dedicated to prudent and dutiful management of the business affairs, particularly in the good times; this is the only way to build resilience buffers and nurture strong relationships with key stakeholders which may prove life-saving in times of need

- Sixth, collation of reliable information, analysis, assessment, expert advice from credentialled experts

- Seventh, diligent, realistic planning, leaving nothing to chance, questioning everything, creating alternative contingent scenarios in case the original one does not go to plan, which will typically be the case

- Eighth, clear and simple communication of the message to those concerned, the key stakeholders: the shareholders, the key human resources, key clients, major suppliers, the financiers, the state authorities, to get them all on-board. The fight is collective, the business needs its allies to stand by it

- Ninth, meticulous execution of the plan, religious monitoring, keeping a close eye on developments in the competitive landscape and the performance of the business, agile adjustment and perseverance to reach the overriding objective.

The tenth principle of resilience is to apply all nine constituents of resilience in the form of an all-encompassing, integrated strategy. A holistic, comprehensive, inter-disciplinary approach. All resilience constituents are inter-related, inter-dependent, essential.

A crisis, if ill-managed, may be destructive, leading to the end of any business. But it may also be the best lesson, the lighthouse for the future of discerning businesses. To make business managers learn how to ring-fence, to safeguard, before the next crisis hits. To guide them to find agile ways of overcoming the bad times. To facilitate business-people to ingenuously create new opportunities out of potential disaster. To make businesses resilient.

Let us save our businesses now. And let us then build true business resilience. For when the next crisis visits us. Which it will.

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